EBAY bulls bought April-dated call options

The shares of eBay Inc (NASDAQ:EBAY - 54.62) turned tail in step with the broader equities market yesterday, ending beneath short-term trendline support for the second straight session. However, the options crowd isn't fazed, with bulls buying back-month calls to gamble on a short-term rebound. In fact, the online auctioneer saw about 21,000 calls exchanged -- more than double its average daily volume. For comparison, roughly 13,000 EBAY puts changed hands.

Digging deeper, the April 55 call emerged as most popular, with close to 3,850 contracts traded at a volume-weighted average price (VWAP) of $2.18. Most of the calls crossed on the ask side, and open interest at the back-month strike swelled by more than 3,100 contracts overnight, pointing to buy-to-open activity.

By purchasing the calls to open, the buyers expect EBAY to power back atop the $57.18 level (strike plus VWAP) -- a chip shot from the stock's recently tagged eight-year high -- within the next couple of months. On the risk side, the most the traders can lose is the initial premium paid for the calls, should EBAY remain south of the strike.

Expanding our sentiment scope, we find that yesterday's appetite for calls merely echoes the growing trend seen on the major options exchanges. The stock sports a 10-day call/put volume ratio of 2.30 on the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), indicating that traders have bought to open more than two EBAY calls for every put during the past two weeks. What's more, this ratio ranks in the 67th percentile of its annual range, implying that option buyers are initiating bullish bets at a faster-than-usual clip.

Ahead of the bell, the shares of EBAY are poised to rebound along with the broader market, with the security pointed 0.9% higher. As alluded to earlier, the equity ended south of its 10-day and 20-day moving averages for the second day in a row on Thursday. This duo of trendlines has led the stock steadily higher in 2013, but could switch roles to serve as a short-term speed bump.